This week saw significant turmoil in the Bitcoin exchange-traded funds (ETFs) market, with net outflows totaling nearly $900 million. Furthermore, this coincides with the drop in Bitcoin (BTC) price and the crypto market crash. The largest contributor to these outflows was the Grayscale Bitcoin ETF (GBTC), which has seen a staggering total of $14 billion in outflows since its launch in January 2024.
Spot Bitcoin ETFs have been seeing outflows all week
The Bitcoin ETFs recorded outflows of over $888 million in the current week. On Friday, March 22, spot Bitcoin ETFs recorded a significant net outflow of $51.6 million, while GBTC alone recorded a daily outflow of $169 million. In contrast, BlackRock's ETF (IBIT) saw minimal net inflows, mitigating some of the negative impact.
Despite the pressure on Bitcoin price, which is currently trading at $64,051 with a market cap of $1.259 trillion, analyst Michael van de Poppe sees BlackRock's continued inflows into spot Bitcoin ETFs as a positive sign for the continued institutional buying activity, suggesting the market cycle is far from over.
GBTC's ongoing outflows continue to weigh on the Bitcoin ETF market, with another significant outflow of $359 million recorded on Thursday, March 21, bringing the total to $1.8 billion week corresponds. Additionally, Bitcoin ETF outflows accelerated, reaching $95 million on March 21 and $261 million on March 20, for a three-day total of $742 million.
While GBTC saw a notable outflow of $386 million in a single day on Wednesday, March 20, IBIT saw a significant inflow of $49.28 million, bringing its total historical net inflow to $13.09 billion US dollar increased. However, concerns about central bank actions have caused ETF inflows to dry up this week.
As Bitcoin ETFs experience multiple days of outflows, totaling $326 million on Tuesday, March 19, market sentiment appears to be changing. Institutional investors appeared cautious ahead of the Federal Open Market Committee's (FOMC) decision on March 20, reflected in subdued inflows across most ETFs.
GBTC's woes continued with a massive outflow of $444 million on Tuesday, exacerbating losses. On the contrary, BlackRock's Bitcoin ETF regained momentum on Monday, March 18, recording $451.5 million in inflows, in contrast to minimal inflows for other ETFs.
Also Read: Five Days of Bitcoin ETF Outflows, But BTC Price Shows Signs of Reversal
BTC price experiences volatility
Bitcoin recently saw a sharp decline after hitting a new all-time high of $73,836 earlier this month. BTC price fell below $61,000 and recovered above $67,000 amid increased volatility. However, despite the recovery, Bitcoin price crashed again to the $65,000 mark.
At press time, BTC price increased by 2.68% to $65,302.84 on Friday, March 23. The oldest cryptocurrency now had a gigantic market capitalization of $1.28 billion. In contrast, the 24-hour trading volume fell by 33.58% to $27.82 billion.
The recent recovery in Bitcoin value was met by short squeezes. According to Coinglass, almost $30.68 million in short liquidations were liquidated for BTC out of a total of $48.31 million. These short traders are expected to buy back their positions to mitigate potential losses. Furthermore, this move could temporarily push Bitcoin price higher, followed by a massive correction later.
At the same time, the crypto market as a whole also suffered a crash. Ethereum (ETH) price plunged from its recent high of $4,092 to below $3,200. Additionally, Solana (SOL) broke below $180 despite rising above $200 earlier this month.
Also Read: Bitcoin Halving History Chart Analyzed
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